The FDI cap in the telecommunications sector of India has been extended to 100% from 74%, to facilitate fresh foreign funds to the cash-starved telecommunications industry of India in coming years. This move of the government of India enables the foreign partners in the telecom companies to helm the complete ownership of the telecommunications business in India. FDI up to 49% will be made through the automatic route, and beyond this limit, the FDI will be performed through the government route in support of the Foreign Investment Promotion Board (FIPB). The majority of the major and leading players in the Indian telecommunications sector, such as Reliance Communications, Aircel, Sistema, etc., have welcomed this decision of the Indian government. The lower section of this article offers exclusive information about the fdi policy in telecom in india, to help foreign investors located in countries worldwide.
According to industry analysts, the foreign direct investment in telecom sector in india can entice about US$ 10 billion in near future. Today, the Indian telecommunications industry is one of the largest and the fastest growing in the whole world, and grew at an annual growth rate as high as 45% in recent years. Supported by regular policy reforms, new prudent and generous government policies, and conducive environment created by the Telecom Regulatory Authority of India (TRAI), the Indian telecommunication sector is fully capable of taking a big leap in the near future. Hence, the scope of fdi in indian telecom industry is surely extensive and bright.
FDI Policy in Telecom
As the telecom services are among the prime support services absolutely necessary for fast growth and modernization of various economic sectors of India, the Indian government has promulgated quite relaxed FDI norms and liberal FDI laws and regulations in this telecom sector. To know in detail about these norms, rules, and regulations, please consult with the FIPB of India, TRAI, and the Department of Telecommunications (DoT), under the Ministry of Communications & Information Technology of the Government of India.
The telecom services which are open to FDI cap up to 100%, include the telecom infrastructure providers category-I, and thus covers the following wide-range of services --- Basic, Cellular, United Access Services, Unified License (Access Services), Commercial V-Sat, Unified License, National/International Long Distance, Public Mobile Radio Trunked Services (PMRTS), Mobile Number Portability Services, Global Mobile Personal Communications Services (GMPCS), All types of ISP Licenses, Voice Mail/Audiotex/UMS, Resale of IPLC, Infrastructure Provider Category-I (providing dark fibre, right of way, duct space, tower) except Other Service Providers.